Child Benefit cap right or wrong?

[summerdays]

Its not just child benefit. The family with two people earning £42k each will get £15k tax free and the rest taxed at 20%. A family with one person earning £84k will get £7,500 tax free and £42k of their income taxed at 40%. That's an income tax difference of just under £10k making the child benefit difference quite trivial relatively.

For us - that applies too especially when I was staying at home looking after children so earning nothing whilst Mr Summerdays had crept over what ever the higher tax rate was at that time. I used to think it would be fair if I could allocate my tax free bit to him. At least I am earning a bit now working part time and yet still around for the kids after school.

 

[Fat B'stard]

once again another kick in the teeth for 90% of the working population. I've rarely seen a government actually do anything worthwhile for the married (single) working family. They are all a load of self-interested bunch of muppets, no matter what colour their rosettes are. As for local government well don't get me started on those cretins

 

[User482]

It is easy to say if someone(couple) earn £xxK so should not get child benefits, and easy to agree with that, but on the otherhand the more you earn the more you pay in.

You'd think so, but in percentage terms, poor people pay more tax than rich people. It's not just about income tax...

 

[oldfatfool]

You'd think so, but in percentage terms, poor people pay more tax than rich people. It's not just about income tax...

In real terms however you look at a couple earning 80k a year will pay more tax than a couple earning 40k a year. The fact that the higher earner *might* save £10k a year and not use it for purchases attracting tax is neither here nor there, beside that they will stay pay tax on the interest and will eventually end up paying tax on the amount saved, be it through later purchases or death duty.

I maintain that the child benefit should not be paid to the parents as some sort of bonus to prove they can procreate, but should be accrued and paid to the child on their 16/18th birthday by the state. The benefits of this are multifold and easy to see. Alternatively scrap it altogether.

 

[User482]

In real terms however you look at a couple earning 80k a year will pay more tax than a couple earning 40k a year. The fact that the higher earner *might* save £10k a year and not use it for purchases attracting tax is neither here nor there, beside that they will stay pay tax on the interest and will eventually end up paying tax on the amount saved, be it through later purchases or death duty.

I maintain that the child benefit should not be paid to the parents as some sort of bonus to prove they can procreate, but should be accrued and paid to the child on their 16/18th birthday by the state. The benefits of this are multifold and easy to see. Alternatively scrap it altogether.

Yes, but the couple earning less pay a higher percentage of their income. When you consider that the poorer you are, the more of your income you have to spend on food and shelter, that's far more unfair than the proposals for child benefit.

 

[007fair]

I won't go into specifics about salary but needless to say I would lose CB, however, my wife works Part-time our combined salary is probably less than many families where both parties work.

While I agree that the country needs to save money this needs to be fair. Someone on R4 suggested splitting CB between both parties in a household and treating both as individuals, this I could accept.

However, what grieves me is that we both run old cars, cannot afford to holiday in this country or abroad yet listen to lots of families on benefits talk about their holiday in spain with the kids and their new TV, ipod etc. I wish I knew how they did it as we struggle to make end meet each month and have no savings.

+1
Are you me?

 

[fossyant]

Anyone know if this is based upon taxable earnings ? Are pension contributions allowed for in this case, especially if you are borderline, ie don't pay 40% tax but pre pension earnings are over the £43k.., taxable earnings below this.

Can't find a definitive answer.

 

[fossyant]

+1
Are you me?

Sounds like me too.

 

[oldfatfool]

Yes, but the couple earning less pay a higher percentage of their income. When you consider that the poorer you are, the more of your income you have to spend on food and shelter, that's far more unfair than the proposals for child benefit.

Have to, in order to get an equal std of living, yes, but a lot of people live to their means.

 

[numbnuts]

A few years ago I bumped into an old school friend who id not seen in over 15 years and the conversation got around to work at which he replied I aint worked in 10 years I asked why he said he was on "the sick" I asked what was wrong and he said dodgy back plus ive got 3 kids with a fourth on the way even more money he said why work,my blood was boiling I wanted to punch him,he said lets meet up for a pint sometime through gritted teeth I said ok he wrote his number down which I binned in sheer disgust at the lazy get.

If he's been off sick for 15 years, he would have been to at least 8-10 medicals undertaken by a government doctor i.e working with the DWP and passed unfit for work.
It is not easy to fake these medicals and your own doctor does not have a say in it, that only happens when there is an appeal, and please don't tell me I'm talking crap for I've been there and not just for 15 years. I don't have a “bad back” I have a damaged spine, your friend may also have one, but calls it a bad back.

 

[MacB]

One of the reasons it has worked so well is due to the universality, introducing any form of means testing adds complexity and cost. It would be far simpler to leave it alone and increase tax, means testing is expensive and unreliable.

Child benefit, old age pension, fill in the bit in the middle and you have a Basic or Citizens income. The woman on Newsnight made a very good point about the inclusive nature of a universal benefit. With a BI you remove nearly all existing benefits and the need for means testing, thus vastly reducing costs. It's pretty simple, everyone gets it from birth to death, lower in childhood then graded up from the age of 16 to 21, then static until you die.

Administration costs drop dramatically, complexity is removed, all work pays and is taxed as it doesn't make any difference to receipt of the BI...everyone gets it no matter what they do or earn. Stigma is removed, dignity is granted as an inclusive member of society.

Split it out and before you know it you've got something as divisive as free school meals...I don't know how they're done now but when I was at school it was part of the register process at the start of the week. So those on free school dinners didn't have to go to the front to pay their money. Anyone that claims that something like that doesn't have a vicious impact on a childs school life, is talking nonsense.

 

[User482]

Have to, in order to get an equal std of living, yes, but a lot of people live to their means.

If you're poor, then most of your disposable income is necessarily spent on rent, food, utilities etc. If you're rich then you may choose to send extra (because you want a bigger house say) but this is very much optional. That's why it's particularly unfair that after tax, poor people are left with a smaller percentage of their income than rich people.

I'm not immune to the arguments about the unfairness of the child benefit proposals, but it's very much small beer by comparison to the unfairness of the tax regime overall.

 

[oldfatfool]

If you're poor, then most of your disposable income is necessarily spent on rent, food, utilities etc. If you're rich then you may choose to send extra (because you want a bigger house say) but this is very much optional. That's why it's particularly unfair that after tax, poor people are left with a smaller percentage of their income than rich people.

I'm not immune to the arguments about the unfairness of the child benefit proposals, but it's very much small beer by comparison to the unfairness of the tax regime overall.

Life isn't fair, Neither Communism nor Nazism work for anyone but those implementing the regime. Its not worth worrying about, like it or lump it, work or don't, stay in the country or move. Vote Labour, Conservative, lib dem, green, the smell is still the same, maybe the depth differs but only by nth of a degree. yadda yadda yadda.

 

[screenman]

User482, what would you consider a fair tax scheme? or does that deserve another listing.

 

[User482]

Life isn't fair, Neither Communism nor Nazism work for anyone but those implementing the regime. Its not worth worrying about, like it or lump it, work or don't, stay in the country or move. Vote Labour, Conservative, lib dem, green, the smell is still the same, maybe the depth differs but only by nth of a degree. yadda yadda yadda.

This thread is about fairness. If it's not worth worrying about, why are you contributing to it?